Detroit Red Wings attendance woes
Last semester, I took Sports Economics and for our final project, we had to come up with our own topic and then present our results. While my results don’t really prove anything since I don’t have the knowledge to perform higher levels of statistical analysis on the data, I did want to share my results and apparently the report was good enough for an A on the assignment. It’s a fairly long report so you will have to click on the read more link to see it in its entirety. The actual results aren’t until the second half of my report.
Question Statement
What factor has the strongest relationship with the Detroit Red Wings attendance: ticket prices, Michigan economy, the success of the Detroit Tigers, the success of the Detroit Pistons, or the NHL lockout?
Wings to lower ticket prices?
I was going through old newspaper articles as I update BTJ: No. 19 and I came across this snippet from a Chris Chelios interview on December 17th.
There are still empty seats, do you guys notice this?
I wish I had the answer. I guess that’s why they hired that new marketing guy. In the past they had [Steve] Yzerman, [Brendan] Shanahan, [Brett] Hull and guys to fill the Stadium. I don’t think we’ve lost fans; we’ve just lost them in the building. I don’t know if it’s the economy, I think that’s part of it. I know they are going to lower ticket sales in January and try and make it affordable for families. I think that is going across the board for the team. And you notice. I mean we like playing at home but you can certainly tell the noise level and intensity level and we hope to get more people back in there.
I have no idea if that statement in bold is true or not, but I think that would do wonders for ticket sales if it’s true. According to ESPN, the Wings are averaging around 18,300 fans so we’re under 2,000 fans short of a sellout. If they dropped the ticket prices for those $44/$54 seats, I think we’d get consistent sell-outs because I believe the fans are there, it’s just the money that’s not.
Wings hire Steve Violetta
The Detroit Red Wings announced yesterday the hiring of Steve Violetta as senior vice president of business affairs. Violetta had been working since July of 2005 with the Nashville Predators in the same position. He is from Detroit and actually got his degree from Central Michigan so I’m sure he’s pleased to be back in his hometown area.
“We’re excited to have Steve and his vast experience as part of the team,†Ilitch said. “This new organizational structure is similar to what we’ve done with the Detroit Tigers and we certainly expect to see similar, successful results as Violetta focuses on making the fans’ hockey experience all it can be.â€
In addition to this hiring, Mike Ilitch also promoted GM Ken Holland to executive vice president and Assistant GM Jim Nill to vice president. The two will still maintain their respective management positions.
“I believe these personnel moves will greatly enhance our ability to meet the ever-growing needs and challenges of operating a professional sports team in a highly competitive market,†team owner Mike Ilitch said. “Ken and Jim have been instrumental in our success over the years. The promotions are well-deserved and, combined with the addition of Steve’s position, will enable us to put the best product forward both on and off the ice and will lead to an even more successful franchise.â€
I don’t really have any opinion about the hiring of Violetta because I don’t know him or really know what he’s down while in Nashville. However, I think Holland and Nill’s promotions are certainly worthy, but I don’t think it will really give them added responsibility (but then what do I know).
Comparing revenue data in sports
I am currently taking a Sports Economics course at the University of Michigan as part of my required classes for a Sport Management major. Anyways, I was doing my reading from the book Sports Economics by Rodney Fort (my professor) and came across a few interesting items of note.
At the bottom end of the revenue distribution, the NFL’s Jacksonville Jaguars have over 2.5 times the revenue of the NHL’s Carolina Hurricanes. The average NFL revenue is just over 1.5 times larger than the average NHL revenue. At the top end of the distribution, MLB’s New York Yankees have nearly twice the revenue of the NHL’s Detroit Red Wings. …
On average, MLB fans spend over 75 percent more than NHL fans. NFL fans spend 60 percent more than NHL fans.
I know that this data is at least four years old, but I would think that the disparities between the leagues have actually increased. The NHL may say it’s doing well financially speaking and that very well may be the case, but the NHL looks like a minor league in comparison to the MLB and especially the NFL.
Data from Forbes in 2003
Smallest Revenue Teams
$48 million (NHL/Edmonton)
$70 million (NBA/Seattle, Golden State, Milwaukee)
$81 million (MLB/Montreal)
$126 million (NFL/Arizona)
Largest Revenue Teams
$238 million (MLB/New York Yankees)
$227 million (NFL/Washington Redskins)
$149 million (NBA/LA Lakers)
$113 million (NHL/New York Rangers)
League Revenue Averages
$70 million - NHL
$94 million - NBA
$129 million - MLB
$155 million - NFL
Wings are #8 on Turnkey Team Brand Index
The latest issue of Sports Business Journal focuses on results of the Turnkey Team Brand Index, which took a look at all 47 markets that had at least one team in one of the four major leagues (NFL, MLB, NBA, and NHL) in North America. The results of this study focused on the strength of each brand in their own market, not how they performed overall. For example, the Dallas Cowboys and New York Yankees are arguably the two biggest brand names overall, but they only came in at #28 and #29 respectively. I just want to focus on how the Detroit teams performed in this index.
The Detroit Red Wings came in at #8 (the only other NHL team to fare better was the Buffalo Sabres, who came in at #4) with a 122.28 rating. The Tigers came in at #11 with 118.69 rating. The Detroit Pistons were back at #15 with a 116.30 rating. The Detroit Lions came in at #117 (out of a possible 122) with only a 78.64 rating.
I thought it was interesting to find three of the four major league teams in Detroit earn placement in the top 15 brands. No other market had more than two teams in the top 15 (and that was only Boston with the Patriots and Red Sox). If you extend this to include the top 20 brands, two more cities would have two teams in the top 20 (Cleveland and Pittsburgh). I think this only helps support the concept that Detroit is a great sports city and we really do support our teams.
Those surveyed were also asked about winning tradition and the Detroit Red Wings were named the #1 team in terms of tradition with the New England Patriots and Pittsburgh Steelers following closely behind.
Two of the NHL’s original six franchises, the Toronto Maple Leafs and Chicago Blackhawks, ranked in the bottom three of the NHL in winning tradition. …
The Detroit Lions, winners of NFL championships in 1935, ’52, ’53 and ’57, posted the lowest score in all of sports, averaging 2.37 on a scale of six used in calculating the index. Those same Detroit fans gave the Red Wings a 5.55, the Pistons a 5.31 and the Tigers a 4.54.
Now there are some flaws to this study, as there always are with every study. Turnkey only surveyed 200-500 people in each market for this index so if you want to just compare Detroit teams, further research should be done to appropriately determine where these team’s brands rank. I find it interesting that despite the decline in attendance at the Joe, the Wings are still considered the biggest brand by individuals in the metro Detroit area.
Sabres don’t sell out a game
A lot has been said about the Red Wings failing to sell out all of their home games thus far this season including their season opener and justly so. According to James Mirtle, the Wings have been the most dominant team in the NHL in terms of hockey attendance over the last 17 seasons.
Over that 17 season span, from the end of the Oilers’ dynasty in 1989-90 to last season, the Detroit Red Wings have been the NHL’s top team for attendance, averaging nearly 20,000 fans per game for nearly two decades. … Detroit’s been a ridiculous model of consistency over the past 17 seasons, so much so that any potential drop off this season would be a huge story.
Graph made by James Mirtle
The Wings aren’t the only team struggling at the gate this season. Despite the threat of their team moving away, the Nashville Predators have failed to reach the 14,000 ticket mark in their first four games to prevent a move of the team.
While the Buffalo Sabres certainly aren’t struggling with ticket sales like the Wings (who no longer have a season ticket waiting list), the Sabres did fail to sell out a game this season breaking a streak of 62 sellouts (45 sellouts if you only include the regular season).
Monday is “not a traditional hockey night in Buffalo,†and the game had the “most expensive ticket-price designation.†Tickets cost $68-203, which “would limit walk-up numbers.†Also, the game was the third played in five nights and a “lack of knowledge about ticket availability†could be factors for the empty seats (BUFFALO NEWS, 10/16).
Bowman talks about the crowd at the Joe
Last week, former head coach and current team advisor Scotty Bowman talked on WXYT-FM. He addressed the top line’s success and how he makes his first evaluation of teams each season. He also discussed the lack of sellouts at the Joe this season, which you can see below thanks to the Detroit Free Press.
On how to get people back to the Joe: Well the first way is to continue to play the way they have. The excitement they have, very two blue chip players, more than two but everyone knows Lidstrom and Rafalski have been terrific for a long time and Chelios, but in Datsuk and Zetterberg, they’re exciting players, the team as long as the team can get its wins together. I know, October, we had three games it’s not easy to sell them with the baseball and football and the college football, there’s a lot going on right now. I think we get rid of October, I know in other years we’ve sold out and everything else and people found their way to watch the Red Wings. Times are changing and we didn’t have the Tigers drawing 3 million people five years ago, but the only thing the players and coaches can do is continue to play a winning brand of hockey and I think they will.
On whether he’s been involved with talks about the crowd within the organization: I haven’t been included in that because I’m not in Detroit on a regular basis but I do know thay they’ve had a lot meetings starting with ownership, Ken Holland, Jim Devellano. They’ve had these different ideas, they’ve had coaches participate and the players participate and they’ve gone after season ticket holders who’ve given up there tickets and they went on a big process of why is the situation the way it is. I haven’t been on that side of it, but I know that they’re not just sitting back thinking that people are going to walk in to the Joe because they’ve came before. That’s not their attitude, it’s a different playing field… for probably 12-15 years there hasn’t been many tickets available. That’s why they didn’t in other years sell every ticket, season ticket, you have got to keep some for the turnover, now the test will be to market the team and it’s a new level of a field.
Honestly, I don’t think the Wings could do anything but lower ticket prices to get a sellout. I mean, the product on the ice is great so you can’t improve that. The team could make its players more available, but will that really make the team sellout? I think it all goes back to ticket prices and people either can’t afford the current prices or simply aren’t willing to pay that price. All the $9 and I believe even the $22 seats sell out, it’s the $44 and $54 seats that don’t.
Wings have 2 more years to make decision
Detroit’s law department has declared that the Detroit Red Wings have until June 2009 to make a final decision on the fate of Joe Louis Arena. It was originally thought that the decision had to be made this week.
The city law department delved into the issue last month at the request of the auditor general, said city spokesman James Canning. Earlier this year, the City Council’s fiscal analyst said the lease expired in 2008, and Olympia had to tell Detroit this summer what it planned to do.
The law department, after reviewing the lease and its sub-agreements which total more than 100 pages, decided the agreement runs through June 30, 2010, and Olympia has until June 30, 2009, to decide whether it will continue operating and using the venues.
I’m slightly torn at what they should do. On one side, the JLA is a piece of crap and the fans deserve an upgrade when it comes to hockey arenas. Don’t get me wrong, the Joe has plenty of character, but it’s just not at the same quality as so many other arenas (hockey or not). However, the Detroit and Michigan economy just suck and I don’t see people being willing to help pay for the new arena when they’re struggling to pay for their house or car. Mike Ilitch has a lot of money, but I just don’t see him willing to pay for a decent portion of the arena costs.
I guess we’ll just have to wait and see…
Bowman may take job with Maple Leafs
According to a source via Globe and Mail, Scotty Bowman has been offered the position of president with the Toronto Maple Leafs.
The source said Bowman was offered the job by the board of Maple Leaf Sports and Entertainment and was given a week to make his decision. An answer is expected by Thursday or Friday and, the source said, Bowman may finally let MLSE catch him after a pursuit that began in the late spring when he spurned the company’s initial offer.
Bowman could not be immediately reached for comment. Neither could MLSE president Richard Peddie or Maple Leafs GM John Ferguson, whose tenure with the team could end with Bowman’s arrival.
However, the signs around MLSE point to a change in the senior management ranks of the Maple Leafs, who have missed the National Hockey League playoffs for the last two seasons.
Bowman had already turned down two previous offers with the Leafs earlier this year. The source added that the reason Bowman didn’t agree earlier was how the Leafs would go about cleaning house. Apparently, this “sticking point” has been overcome and why it is believed Bowman will accept the position.
If he says yes, it’d be great for Toronto and a chance for the team to turn around starting with the front office. While he is only an advisor for the Wings right now, it would suck losing him. Mike Babcock called Bowman once a week during the season to pick his brain and it’s been nice having Bowman around. Plus, he’s 73 so I’m hoping he sticks with the advising role and turns down the Leafs’ offer.
Thanks to James Mirtle for the heads up.
Update: TSN is now reporting that Bowman himself emailed them and said that has not received an offer.
“I have not received an offer from the Leafs, and I don’t expect one either,” Bowman told TSN in an e-mail.
Bowman was initially contacted by a headhunter representing MLSE in late June, but declined their offer to be either a senior advisor to GM John Ferguson, or to take over as team president.
That’s a relief and hopefully all the MLSE and Bowman rumors may be put to rest.
A look at season ticket waiting lists
As a sport management and communication studies double major, I’ve noticed myself taking a greater interest in sport business articles. As a result, you’re going to find me writing about these articles more frequently and they won’t always be NHL business stories, but I’ll try to connect them to NHL business if a connection exists.
This is a lengthy post about the Detroit sports’ teams and their waiting lists as well as a look at every single NHL team’s ticket sales.
Anyways, I was reading a post at the AOL FanHouse about the length of the waiting list for the Philadelphia Eagles (NFL). The team has over 60,000 names on the waiting list.
According to Eagles president Joe Banner, the waiting list now contains more than 60,000 names and, last year, a grand total of 15 of them were given the opportunity to buy tickets. Fifteen!
“We don’t know what it will be this year,” Banner said. “It could be 20. It could be 12. We don’t know yet. But it’s like nobody is not renewing their tickets. For the people who already have season tickets, the renewal rate is 99.9-something percent. That’s the situation.”
Michael at the FanHouse made this observation:
At 15 a year, it’ll take 4,000 years to get through 60,000 names. So with demand far outstripping supply for tickets, why don’t the Eagles raise ticket prices? Fans often complain that it’s too expensive to get to a game, but isn’t something that is too scarce to meet customer demand the very definition of an underpriced product?
The Green Bay packers currently have 74,500 fans on the waiting list.
It’s figures like those above that remind you of how dominant the NFL is here in the United States.